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Mr. Leslie H. Gelb (Council on Foreign Relations): We have two of the leading Americans who think and work on U.S.-China policy, indeed Asia policy and, in Chas. Freeman’s case, lots of things beyond that as well. They come to us as serious scholars, policy thinkers. We are not presenting an artificial debate here between two stick figures. I would imagine from time to time we’ll see some overlaps in their positions and that’s fine as long as we hit on the major policy differences that we ought to be thinking about. I won’t repeat their vita except to say that they are among the people whom you should read. We’re lucky to have them today.

We’ll begin with Chas. Freeman today. I will be ruthless in warning you about one minute remaining and ruthless in cutting you off at that point. Gentlemen.

Mr. Chas. W. Freeman, Jr. (Projects International, Inc.): Thank you Les. The proposition that suddenly landed on my desk while I was on the road was “If Taiwan declares independence and China reacts with force, who should the U.S. lean on harder, Taiwan or China?” Let me begin by saying that this proposition has been overtaken by events and it presupposes a degree of freedom of choice on the part of the United States that no longer exists.

Taiwan has declared independence without using the words. That’s what Lee Teng-hui’s “two states doctrine,” which he proclaimed on July 7th last year means. Taiwan has just elected an avowedly separatist president. The United States supports Taiwan and arms it to defend this state of affairs described by Taiwan as independence. Despite a declared policy by the United States of one China, the U.S. one China policy is rejected by Taipei. It is disbelieved by Beijing. And, it is not understood by Americans.

No one in Taipei or in Washington supports peaceful reunification of Taiwan with the mainland. And no one in Beijing believes that reunification can be accomplished peacefully. So the U.S. policy of the last thirty years of peaceful settlement in practice means no war and no settlement. U.S. policy now depends purely on military deterrence with no effective political element.

Taiwan has buried Chiang Kai-shek’s insistence that Taiwan is part of China. The U.S. has abandoned the trade-off between American restraint and gradual reduction in arms sales to Taiwan. This trade-off was in return for Chinese restraint and focus on a negotiated, rather than military, solution to the problem of China’s dismemberment. There is no longer a credible scenario for peaceful reunification. Beijing, not surprisingly, has concluded that reunification will only be possible through coercion. Taiwan and the United States are headed toward a violent rendezvous with Chinese nationalism.

What will happen if events continue in the direction that they are now proceeding? China will use force at an opportune moment—after it has completed the necessary preparations, the preparations it is now making—or when it feels it has been provoked beyond political endurance. Whichever moment occurs first. Now, fortunately neither is likely to occur in the near future. But the reality is that these are the trends.

The U.S. will intervene because it will seem to our politicians that we have no choice. I am confident that the American military will win the conflict in the sense that the damage to Chinese forces will be much greater than that to American forces and that China’s objective of compelling Taiwan to come to the negotiating table will not be achieved. Assuming that the Untied States does not strike targets in the Chinese homeland, perhaps the Chinese will not strike U.S. bases or targets in the U.S. homeland. But China will not go away. Nor will China abandon its objective of reunification. China will try again and again and again. Just as in the 17th century there were 11 attempts, the first 10 defeats, before the then Ch’ing forces succeeded in taking Taiwan and re-incorporating it into Fujian province.

The People’s Liberation Army is no less determined than the Ch’ing was and, in fact, has much stronger popular backing than that alien army did. If this scenario plays out, U.S.-China hostility will emerge as the dominant feature of the 21st century’s international relations. Chinese’s incentives to appease or defer to American interests will be gone. China is very likely to back U.S. enemies elsewhere in order to divert American attention or to pin down U.S. forces while it acts against Taiwan. The implication, therefore, is that Sino-American confrontation may begin with Taiwan, but the struggle will gradually become global. The result of this scenario is a cold war with hot flashes in the course of which the very qualities which make Taiwan so admirable seem certain to be destroyed.

The irony is that, as in all classical tragedies, no one wants war, this scenario or the consequences of this scenario. Each side can see the very strong possibility that the course that all are now on will lead to disaster but each has compelling domestic political reasons to march on without deviation from the course it has set. Up to now, the United States has repeatedly asserted that “our only abiding interest is that the Taiwan issue be settled peacefully by Chinese on the two sides of the Strait.” This is no longer either an accurate description of American policy or even a plausible policy. And the United States now must decide whether prevention of reunification, even the essentially symbolic reunification under a looser form of the “one country two systems” formula already applied in Hong Kong and Macao, is worth a war—a protracted struggle with China. Is it really so important to us to preserve Taiwan as a self-proclaimed, if not internationally recognized, separate state? If so, we must accept that the longer term enmity of China is a certainty. We will need a much larger defense budget and military establishment than we now have and we will also need a high measure of resolve, sustained over decades. The only thing worse than a war with China over Taiwan would be a series of such wars followed by another American decision, as in Vietnam, that we care less about the outcome than we thought we did and that we should cut our losses, walking away from those we have previously assured we would bear any burden and pay any price to defend.

My view is that the stakes in Taiwan are not worth such a scenario or such a struggle. Reunification on terms like those proposed by Beijing would threaten no American or allied interest. It would not entail a presence of the People’s Liberation Army in Taiwan. There would be no change in north-east Asian strategic alliance or balance. It would not alter Taiwan’s ability, the ability of the voters in Taiwan, to elect their own leadership and govern themselves. It would not affect Taiwan’s economy or way of life. It would not deprive Americans of any of the human ties we enjoy with people on the island. It would, however, eliminate the only conceivable cause and venue of armed conflict between the United States and China. And it would maximize the influence of the values Taiwan exemplifies on the mainland.

I do not believe that Taiwan’s democracy or prosperity can survive war with the rest of China or that a U.S.-China war to decide whether Taiwan is or is not part of China can be survived by Taiwan. And I think we should be leaning on Taiwan to recommit itself to working out a relationship with the rest of China on terms acceptable to China as well as to people in Taiwan. This means negotiating some form of reunification. To this end, in my view, we should declare with the G7 other great powers that we will neither recognize Taiwan as a state separate from China nor recognize any change in the status quo that is unilaterally imposed. We should urge a return to dialogue across the Strait aimed at a peaceful resolution of Taiwan’s relationship with the rest of China. We should suspend new arms sales to Taiwan pending a clarification with President Chen about what it is we are defending in Taiwan. We should make it clear that we will withhold support if his choice is to pursue separation.

Mr. Gelb: Thank you very much Chas. Freeman. Arthur Waldron—

Mr. Arthur Waldron (American Enterprise Institute; University of Pennsylvania): Thanks very much. At lunch Lally Weymouth asked me, “Do you agree with Chas.? Do you think there is going to be a war?” My quick answer was “No,” for reasons that I’ll explain, but I did sort of meditate on this and I realized that in 1989 I didn’t think there was going to be a crackdown in Tienanmen Square either. I just couldn’t imagine the People’s Liberation Army with the bayonets and there’s the student actually going for killing the student. I just couldn’t see how that was going to be done. In a sense that analogy introduces what I have to say. Chas. has looked at these three players in rather abstract terms as sort of systems of propositions. I think it’s very important to introduce into this the question of the character of China. Because I think the reason for the rising tension, the fundamental reason for the rising tension, in Asia and in the Taiwan Strait area is not to be found in geographical assertions by Taiwan. It’s not to be found in minutia of communiqués. It basically has to do with the regime type in China. And I would argue that just as it is the case that in Eastern Europe and the Soviet Union what it took to get real peace was a change in the system in the Soviet Union, which has removed the terrible, terrible problem of possible nuclear war—you know the sort of “the morning after,” all this kind of stuff. There are new problems to be sure but I think that the possibility of real peace and openness in Western Europe and Eastern Europe had to do with that regime change. And I think, frankly, that until there is comparable change in China there’s going to be a tense situation that is going to have to be managed.

Now needless to say, I’m in favor of negotiation and I think it’s quite possible for the two sides to keep on managing their differences as they have. However, as I listen to Chas. I’m reminded of one of my early memories, namely President Kennedy’s inaugural speech, in which he said “we must never negotiate out of fear.” And I think one of the things that worries me about the current approach is that the fundamental reason that is advocated for change in American policy, for reversing a whole series of undertakings that have been made—most recently President Clinton talking about the people of Taiwan must “assent,” he used the word “assent,” to the future whatever it was going to be, to his repeated insistence on the non-use of force—as I trace these things back to their origin, it is the specter of war which contributes to it. I am reminded in the 30s Stanley Baldwin made a fascinating remark. He said, “the bomber will always get through” and I think the fear of what war would mean, and it was quite justified fear, was one of the things that contributed to a set of misguided policies that actually, I think, had the effect of bringing war closer. But I also agree with the second half of President Kennedy’s statement, namely, “We must never fear to negotiate.” And I think that the way you get negotiations is by having them be open without pre-conditions, honest, candid and above all you want to have interlocutors who have a high degree of credibility and support in their own countries. And I, unlike Chas., have been very heartened in what I have seen in Taiwan recently. Chen Shui-bian has moved to the center. There is now a high degree of consensus between the nationalists and the DPP parties about China policy. And if you look at the appointments that have been made, these are sober, serious people. These are not a bunch of hot-heads. These are people who have the willingness to make fair deals and they also, I think, have the credibility to carry them through.

But that’s just the Taiwan side. I’d like to say, if I could, briefly, just give you two anecdotes that struck me. We have Chinese TV at home and I’ve been watching a lot of what’s going on. One of the figures who has emerged in Taiwan has been Lee Yuan Tseh who is the President of the Academia Sinica, the Academy of Sciences, Nobel Laureate in Chemistry. Every Chinese mother’s dream. Somebody who has been wooed by every political faction in Taiwan, and he has been, until recently, carefully non partisan. But he came out in support of Chen shortly before the election and since then he has been involved as a kind of senior advisor. Why did he come out? He said, “when I saw gangsters going to political rallies, I felt that it was time for people like me to come out.” And one of the things that I think one sees in Taiwan in the aftermath of the election is that people who have previously held themselves back from the political system are beginning to become involved, and, in effect a kind of government of national unity is being formed. And people of great talent, whether they are industrial leaders, academics and so forth are willing to serve their country.

Now, at the same time in the PRC what’s happening in the Academy of Sciences, the Chinese Academy of Sciences? Well, you have a purge beginning in which liberals notably, Li Sheng zhi, the former Vice President since at least 1984 of the Academy are being put out of office. And the reason is that he and others like him have talked about the need for democratic reform, for openness, for an end to corruption, for an end to favoritism in PRC.

Another contrast, Chen Shui-bian is the son of landless farmers—the poorest people in Taiwan. Somebody who made his education. He scored very high on the college admissions. He went to Taiwan University Law School, gave up a career as a corporate lawyer to become a human rights lawyer. His wife, of course, was almost murdered in what many believe was a fake traffic accident. She is now confined to a wheelchair. This is who is inheriting power in Taiwan, the people who live there.

Now who is inheriting power in the mainland. Those of you who do business there, who do you do business with? You do business with the Taizi Dang, the princes’ party, the children of the leadership. It is a very, very different situation. And my own view is that it is not so much Taiwan’s desire to go it’s own way. Or one country, two systems or two states. The real problem with Taiwan is what Taiwan stands for within the domestic Chinese political system. The intelligence we have indicates that PRC was very upset that the ruling party could be thrown out in a vote. This really shocked them much more than the fact that Chen Shui-bian is a so called “splitist.” It is the example of Taiwan and the fear that that inspired in the Beijing leadership. This is not confined to Taiwan. I would argue that the problem of democracy in Hong Kong is going to start having this valence pretty soon.

Well, what should the U.S. do? Let me just consider in the time remaining what an attack would be like. Chas. pointed out that it wouldn’t work and I would make the same point. It wouldn’t work. If you go by sea and air your planes and ships get shot down and sunk. You fire missiles. Well, they have to be fired over protracted period of time. CNN is covering it. As one of my friends who is a banker said in 1996 correlating capital flight with missile launches, “They’re getting less and less buck for their bang.” If you look at Desert Storm or Kosovo, the kinds of operations that PRC models their plans on, none of these worked. NATO went after Yugoslavia with everything they had and it went on 77 days. The idea that there could be a quick and easy and clean victory is a chimera and this is not going to happen.

Meanwhile, what’s going to happen to China if they do this? The U.S. economy will be closed to them. The tacit agreement to improve their people’s livelihood will be broken and the U.S. will have no choice but to stand by what a whole series of Presidents have said, namely peaceful resolution is number one. There is no independence loophole in any of those statements. So I would argue that what we should do now, even as we try to encourage peaceful resolution is see to it that deterrence is such that the people in Beijing realize that such an attack would not be in their interest. Because, although they may be irrational at times, they may irritate us at times, I don’t believe they are suicidal. Thank you.

Mr. Gelb: Thank you, Arthur Waldron. Two minutes each, starting with you Chas., and let me encourage you even at this point to interrupt each other and talk to each other.

Mr. Freeman: Let me begin by agreeing with one important point that Arthur made, namely the emergence of a democratic, prosperous Taiwan, a society with a high level of respect for human rights and the rule of law on Chinese soil, has produced, by far, the best society that has ever existed in China, whatever that is. So I yield to no one in my admiration of what has been accomplished in Taiwan and I think U.S. policy deserves a great deal of credit for having created the conditions of lowered tensions and better relations with the mainland that made that possible. Ending martial law and producing an investment climate that would be attractive to overseas Chinese, overseas Taiwanese and to foreigners alike. Let me say also that I think the initial reactions in all three of the concerned societies to Mr. Chen’s election speak well for the quality of the leadership. Mr. Chen, given the political universe he inhabits, which includes a Vice President with a—how to put this—whacko devotion to Taiwan independence and many followers who are very extreme, has behaved with admirable judgment and moderation. Mr. Zhu Rongji and his colleagues in Beijing, the Chinese government have similarly not overreacted. They have been careful and said that they will wait to listen to what is said and see what is done. And I think that the United States, given the political universe that we inhabit, has also behaved with great restraint. So, this is not the issue. It is quite apparent to leaders in all three societies how much we would lose if the scenario that I outlined were to play out. That does not make the scenario impossible.

Let me just finish on one point, if I may. Arthur’s basic premise, however as I understand it, is that no resolution is possible without getting rid of those dreadful people who now run China—

Mr. Waldron: You mean that seriously, I trust. They are dreadful!

Mr. Freeman:—Well, I’m glad to hear you use—fine, I won’t—

Mr. Waldron: Would you agree to that, on the record?

Mr. Freeman:—I won’t argue that the regime in Beijing is anything that I would care to live under. But I would say—

Mr. Gelb: But It’s ok for the people of Taiwan to live under—?

[laughter]

Mr. Freeman:—No, it’s alright for the people of Hong Kong to live under that regime, under the arrangements that have been worked out.

Mr. Waldron: Why is it good for them, if it’s not good for you?

Mr. Freeman: I’m just saying that I am happy—I’m very happy that for the last 150 years I was not born in China. But let me finish my thought—and that is simply that if the proposition is that the Taiwan issue’s resolution requires the replacement of the regime in Beijing with something else and if it requires answering the American thirst for enemy identification by identifying China as an enemy, I continue to believe that those are unreasonable conditions and not likely to be satisfied.

Mr. Gelb: Thanks, Chas. Two minutes thirty seconds, Arthur.

Mr. Waldron: I guess my quick view on this—one thing I didn’t mention is the alliance dimensions of all of this. I don’t think it’s unreasonable to apply the same sorts of standards to people in Asia that we do to ourselves as what they are entitled to. I remember my old teacher John Fairbanks saying, you know, Communism is good for them but no good for us. That isn’t a very good basis for action and it fails—it causes us not to understand what people really think in these areas. People in Hong Kong are not, in fact, very, very happy. But it’s very important, even more important, that the United States not become an enabler or an enforcer for China. And what Chas. seems to be saying is that China is big and mean and that it’s probably better for us to go around and tell people in Asia “don’t make trouble,” than it is for us to go to China and say “don’t make trouble.”

Now, where do our interests with Asia lie? Our interests in Asia lie with the democratic and free market countries that share our values and that are going to be there with us come a crunch. China is not going to be there in the crunch. Japan, South Korea, Taiwan, Thailand. There is a whole series of countries out there. More and more of them are becoming democratic.

Now, if China adopts this military action toward Taiwan—in addition to destroying China’s economy and so forth and leading to war—this is going to cause those countries, probably no matter what the United States does to say, “Look, China is really dangerous. They do crazy. We better be sure we have some long range missiles. We better be sure we have some force projection capability. We better be sure we have weapons of mass destruction.” If the United States is leaning on the person who is being attacked. That will make all of these messages stronger by an order of magnitude. They will say, “Well, that’s the kind of ally the United States is. As long as China isn’t too threatening they talk about a peaceful resolution. As long as there’s no price they worry about freedom, but come the price, they’re over there pressuring Taiwan to give in and they could do the same to us.”

Mr. Gelb: Gentlemen, I thank you very much. I felt illuminated, but I also felt, as the surrogate for the audience, that you danced around the issue for debate which is this, let me bring you back to it. “Taiwan declares independence, or something of the like in some fashion. China responds with military force, un-described but it’s no longer words. What’s the U.S. reaction? The reason why we put the question to you, I think, was not to create an artificial debate, but I think to really see where your positions lead in terms of two very practical questions. One is how direct and tough should we be with the leaders of Taiwan in telling them ”Hey, don’t go near this one. Don’t go near a declaration of independence.“ And by the same token, how tough and direct ought we to be to Beijing in terms of ”Don’t you go near using military force, because then you’ll have to deal with us in some fashion.“ And the third question, which is, who do you lean on hardest in this situation? Do you lean more on Taiwan or more on Beijing? I think those are the questions that are really at the heart of the issues we put to you.

Mr. Freeman: But you see, Les, I don’t agree that those are the issues because I think that there is virtually zero prospect of Taiwan gratuitously provoking Beijing with a declaration of independence. I think the question before Taiwan now that has been put clearly by Beijing is ”Are you prepared to reverse course from the declaration of independence, without using that word, that you have already pronounced. And if you are not prepared to reverse course. If you adhere to the view that you are entitled to be treated by the international community and by other Chinese as a separate state then the consequences of that will be the use of force.“ I would like to remind everyone at this point, the difference between the Taiwan issue and the issues of divided countries such as Germany, Korea or even Vietnam is that those countries were divided as a result of great international conflict and international agreements. Taiwan was divided by civil war and an accidental intervention to halt, not to suspend, the civil war in the context of other events.

Mr. Gelb: Basically Chas. you are saying that this is a non-issue. That you don’t think Taiwan will come near provoking this crisis?

Mr. Freeman: No, I think Taiwan has already provoked this crisis and I think that it’s foolish to focus on a question that is unrealistic. Mr. Chen is not going to declare independence.

Mr. Waldron: Could I ask just a point of information. If we went to the State Department today and was asked their lawyers, ”What is the position of the United States, is Taiwan part of China?“ Anybody know what they would say?

Mr. Freeman: I think that I can answer that—

Mr. Waldron: I’m sure you can—

Mr. Freeman: What they would do, is cite to you the communiqué on the recognition of the People’s Republic of China which states various propositions of the United States among which is the proposition that within the context of our recognition of the People’s Republic of China as the sole legal government of China, we will have unofficial relations with the people of Taiwan and it specifies the nature of those relations.

Mr. Waldron: Well then Chas., why was it that in 1995 when Mike McCurry stated in a press conference that the American position was that Taiwan was part of China, that the White House then corrected itself a day or two later and said that that was not the official American position.

Mr. Freeman: I do not wish to be put in a position of defending the White House’s meanderings around foreign policy or Mike McCurry’s odd notions of international recognition, but I would note, and this is also not unimportant in the context of alliances, that virtually no one caveats recognition of Taiwan’s status as part of China in the way that the United States has caveated that.

Mr. Waldron: What about Japan?

Mr. Freeman: Japan has not caveated that—

Mr. Waldron: No, they have—well, we can go into detail. I just want to raise a point. I have asked several international lawyers about this and I see several distinguished ones, at least one distinguished one there in the audience that I recognize—

Mr. Freeman: I see one too!—

Mr. Waldron:—one of the interesting things to me is that it’s by no means clear, if you look at the history of American thought about the disposition of Taiwan since the end of the second World War that you can get to the proposition that we believe legally Taiwan is part of China. I believe that the American legal position is that its status remains to be determined according to unspecified processes. But we also insist that the two sides believe that there is only one China.

Mr. Gelb: Arthur, can you please come back to my question—

Mr. Waldron: All right, I’ll answer your question—

Mr. Gelb: —Do you agree with Chas. that in effect this whole issue of declaration of independence is a non issue?

Mr. Waldron: No I don’t because I think that if it were a non issue, in a sense, we wouldn’t be arguing about it. That Chen Shui-bian would not have changed his position. What the people in Taiwan have done is create a consensus which lays the basis for a realistic solution. I mean you are not going to get a solution to Taiwan, to this issue, which meets everybody’s expectations on every side. You’re not going to get one in which Taiwan is somehow not a state. So, when Lee Teng-hui used that phrase about two states he was drawing precisely on the inter-German recognition language of a special two state relationship. And the Germans said things along these lines. We are not independent countries, we are part of the same country, but the nature of our relationship and the binding quality of our treaties is the same as it would be if we were. And that’s an example of creative use of language which made it possible to square that circle, I think, with very beneficial results. And frankly, I think if you are talking realistically about settlement that’s where you have to go.

Now let me just answer the question about what the United States should do with war. Suppose you’re the President and for unspecified reasons, Chen Shui-bian or whoever it is in that lieu has succeeded the presidency and what this does is it focuses—one of the things we Americans believe is that somehow Taiwan is the problem. All of this growling and everything from China is all being caused by these folks in Taipei. I would argue against that. If you’re the President what speech do you give? It seems to me you say, ”Got to stop fighting,“ and you say, ”Taiwan, you rescind that declaration of independence.“ Well, you probably get it rescinded but you’re going to want some guarantee of non-use of force use thereafter. Guarantee of non use of force means that PRC not only will have failed to get what they want this first time, but they will then have to say we won’t do it again which denies them the stick that they have been using all along. So this is a lose, lose, lose proposition—

Mr. Freeman: —quite so—

Mr. Waldron:—But if you ask yourself how it’s going to work out, how it’s going to play out if you were the president, some people might say you ought to go on TV and say, ”Look folks, they asked for it. They asked for it. They’re taking a beating. I’m sorry to say, but it’s in our interest.“ That is not going to sell in the United States. It’s not going to sell in the Congress. It’s not going to sell in the press. It’s not going to sell in Tokyo. It’s not going to sell in Seoul. It’s not going to sell anywhere. So if you’re the President you don’t do that. And what you do is something which basically restores the status quo ante.

Mr. Freeman: If I may—I think that one of the difficulties, Les, that you had in putting together today’s discussion is finding anyone like me who is foolish enough to stand up and say what is clearly politically incorrect in the current U.S. atmosphere in Washington. Read the editorials in the Washington Post. Listen to the statements on the floor of the Senate. Look at the 435 to 0 vote in favor to Lee Teng-hui’s visit to an institution he had created, funded and so forth at Cornell, on the floor of the House. Look at the 99 to 1 vote in the Senate. The one Senator who voted ”No“ is doing very well in business with China I might note.

The fact is that the other reason I object, Les, to the proposition you put is that I don’t think there is any question that the United States would intervene. Let me just make a point here. There are three capitals involved. And let us not get involved in theology and diplomatic mumbo jumbo. There are three decision making capitals involved here, Beijing, Taipei and Washington. Of these three, two know exactly what the United States will do in the event of a war in the Taiwan Strait. Beijing knows the United States will intervene. Any doubt it had was dispelled in 1996 when carriers turned up in the Philippine Sea. Beijing’s military planning pre-supposes American intervention and takes into account the need to sink aircraft carriers and other things—

Mr. Gelb: Chas., is it so self evident that we never had to tell them we would intervene?

Mr. Freeman: I’m telling you that their operating assumption is that we will intervene. Taipei’s operating assumption is we will intervene. That’s why they take the risks that they have taken. The only one of the three capitals that doesn’t know what the United States will do is Washington!

Mr. Gelb: Well there you have it!

Mr. Freeman: Some people mistakenly call this ”strategic ambiguity.“ It is not. It is strategic ambivalence or confusion. Which is why I’m not going to get drawn into defending what spokespersons say to each other across the Potomac.

Mr. Gelb: But Chas., aren’t you making the point, if we are ambiguous about it, if the only place there seems to be any doubt is Washington, why isn’t it then an issue?

Mr. Freeman: It is an issue that the United States, as I argued, must decide. Do we care sufficiently about preventing the symbolic reintegration of China to go to war on this issue? If we do, then we should continue behaving the way we are behaving, which is in complete violation of understandings we had with Beijing about restraint on arms sales, which emboldens people in Taiwan not to feel under pressure to negotiate and which will end in some kind of confrontation with all of the possible consequences I outlined.

Mr. Waldron: So Chas., you’re saying Taipei should negotiate out of fear.

Mr. Freeman: I’m saying exactly nobody ever negotiates—In my experience in business nobody ever negotiates unless they either feel they’re going to gain something important or they’re going to lose something if they don’t negotiate.

Mr. Waldron: Well then why don’t we talk about gains. It seems to me that there are tremendous opportunities on both sides of the Strait if this issue of war, which could—is going to sink everybody’s economy—if that could be put aside. And I dare say that if Deng Xiaoping were currently in charge in China, a man who had the credibility to tell generals or civilians who were getting a little overheated on the Taiwan issue, tell them where to go, tear their stars off or whatever, that we would have been able to resolve this and create possibility of very, very positive relations. I mean, despite the military threat, and I think it is a real threat, you have 40 billion dollars of Taiwan investment in mainland. You have a hundred thousand marriages or whatever they are...official partnerships, developing and so forth. There is an awful lot going on there. These people don’t want to fight. I mean the saying in China is ”In Beijing they want to fight, but south of the Yangtze nobody wants to fight.“ This is to a very large extent an issue which is being—it has a real basis—but it’s being hyped up in China as part of the regime’s attempt to re-establish its legitimacy after the 1989 massacre without embracing meaningful political reform.

Suppose instead of firing those people from the Academy of Science, they had put those people on a committee to discuss where China was going. Think about how much better received that might have been.

Mr. Gelb: Let me put a proposition to both of you again, just to try to illuminate the strategic thinking behind your positions. There are some people, as you know, who argue that this is much more of a phony crisis than a real crisis. That the leaders in Taiwan, the leaders in Beijing really understand that the name of the game is kabuki. That the Taiwan leadership has to be tough enough on this issue to placate those people in Taiwan that don’t want to be ruled by China. And the Chinese leadership has to be tough enough on this issue to placate the People’s Liberation Army and whoever else. But that it’s a kabuki game and if we just are cool about it and treat it as common sense, it’s never going to be an issue. Is that what either of you is arguing?

Mr. Freeman: No

Mr. Waldron: No, I—

Mr. Freeman: If I may, I think Arthur is in fact coming close to those arguments. I would say that there are two arguments of that nature. One is that the Chinese, somehow, are homo economicus. They are people who are just so interested in making money that they do not fight which is something that history belies. And which I do not believe. I think that it is wonderful that there is 40 billion dollars worth of Taiwanese investment, 30,000 Taiwan companies with investment on the mainland that a million and a half or more people from Taiwan travel—[tape ends]

—[tape resumes] artificial about the Taiwan issue in Taiwan politics. Arthur poses the question. Would Deng Xiaoping, were he in power, handle this differently? Perhaps. I think there is a problem in the United States and on the mainland, not in Taiwan I believe, although we may yet see it emerge there, of weak government and government that yields to political expediency rather than considering the long-term advantages of the country adequately. However, I note that to date, despite enormous agitation within the political elite on the mainland to do this, the government has not abandoned the goal of peaceful reunification. It has not retreated to its original objective of military liberation of Taiwan. In fact, the white paper, much misunderstood in the United States, is a blueprint for peaceful reunification and a negotiated solution. It is not a declaration of belligerency.

So, I think that there are those who argue, Les, that because no one wants something to happen it cannot happen. Because no one at the public level in Europe wanted the events of August 1914 to occur, there could not be a war and yet, notwithstanding the best interests of everyone in this circumstance, as I have argued, each party has its own domestic political reasons for staying on course and the course leads over the precipice.

Mr. Gelb: Thanks Chas. Very quickly because I’d like to come back and ask you a question—

Mr. Waldron: Well, I don’t really agree with that. I think that in August 1914, just to play historian, if the Austrians had accepted the Serbian response to their ultimatum in which the Serbians were very, very forthcoming that the war could have been avoided. But the Austrians wanted to teach the Serbians a lesson and that is one of the things that—

Mr. Freeman: Are you arguing that Taiwan should accept the mainland’s proposition?

Mr. Waldron: No. What I’m arguing for—I’m saying that if both sides will accept some kind of a reasonable—what I always call a ”baptism of the status quo“ because that’s, frankly, what’s on offer. We have to find a way to take the way things are now, make it clear that that’s not going to change and express it in ways that are acceptable to both sides and get on with other things.

One other point. Chas. was talking about the long term interests. I would stress, and I haven’t mentioned it enough today, the most basic reason that I think we have to take the position that I have argued in favor of maintaining our commitments to Taiwan, has to do with alliance structures. Our security in the Pacific rests primarily on our alliances with the other countries out there that share our values. And that is what we have to work on. China is not a substitute for that and we don’t want to undermine that.

Mr. Freeman: This is a very important point. It has been stated that we must ”maintain our commitments to Taiwan.“ Did the United States make a commitment to produce Taiwan independence? Did we ever do that? Or did we make a commitment to create conditions in which the two sides could negotiate a resolution within the context of one China? And second, exactly who are these allies in East Asia or elsewhere who are eager to join in some kind of U.S. war with China to produce some kind of Taiwan independence.

Mr. Gelb: Arthur, will you respond?

Mr. Waldron: Sure, sure. I think that we go back to something interesting here. When we established relations with Beijing we were agnostic about what the future held. There were a lot of nods and winks. I think it was a widespread expectation that after a decent interval, Taiwan was going to come to terms and the issue was going to come mute. Those were the expectations in the late 70s and early 80s. And there is a lot of disappointment, all around, that that didn’t happen. Not me, but there are people who are disappointed and they feel, in a sense, cheated that just when we thought we got this monkey off our back. We’d done it. You know, the kiss of the mafia don. The guy is back at the dinner party. And not only that, but the guy shows no signs of going away. But we did make some other commitments that were really clear. For instance, here’s Harold Brown in 1979 ”the Administration has consistently confirmed a continuing U.S. interest in the future security and well being of the people of Taiwan and it’s expectation, not hope, expectation that the Taiwan issue will be resolved peacefully.“ And I can multiply examples of that kind of statement indefinitely.

Mr. Gelb: Let me interrupt you for a minute. One last question before I open it to our colleagues here. You’ve come very close to saying, Arthur, in effect we can have it both ways. Improving relations with China without moving on the Taiwan issue and that we can maintain at least the status quo for Taiwan. Is that wishful thinking on your part? Don’t you think that this is a strategic choice question where, what’s been motivating every Administration, basically, is the notion that China is a much more strategic relationship to the United States than Taiwan is. We all feel very sympathetic to Taiwan, but China is a big question about the future of world politics. And if push comes to shove that is going to be more important to us than Taiwan. You’re saying that kind of strategic thinking which I think has motivated almost every Administration, is wrong?

Mr. Waldron: No, I don’t think it has. I think if you look at the Reagan Bush Administrations you find an approach to Asian policies which says, ”Look there are a lot of countries out there. China is only one of those countries and if we work with all of those countries—we strengthen our ties with Japan, we work with the Philippines, we work with India, and so forth and so on—and create a web...and what I always say is look, Asian politics and security is like a jigsaw puzzle, but the nature of this puzzle is that you have to put down all the other pieces first. And then after you’ve put all the other pieces down, then the place for China becomes rather clear. The way that you stabilize Asia is by first establishing a kind of a framework among the countries that are more like us—that have robust institutions, that have democracy, that have economic freedom. And once you’ve created that and that’s strong, China, more or less, is going to fit into that. And if China doesn’t we’re hedged against the possiblity.

The danger comes when, as we have done repeatedly...I wrote a book about how we did this in the 20s and 30s, we begin to focus too much on China and think of the other states in the region as being shock absorbers. And we can go over and tell them, “Well, don’t do this it might upset China,” or “China hasn’t agreed to do exactly what you want but don’t cause trouble.” In other words, we get drawn into a Sino-centric policy. I believe that a wide-ranging, Pan-Asian policy is a recipe for success while a narrowly focused China-centered policy leads to trouble.

Mr. Freeman: But the fact is, Arthur, that it was Ronald Reagan, and no one else, who reached an agreement with Deng Xiaoping not to pursue an American policy of supporting Taiwan independence to cap the quality and quantity of U.S. arms sales to Taiwan and gradually to reduce those sales to Taiwan with a view to a final resolution. And that was Ronald Reagan. And Ronald Regan reached those conclusions not because he was ideologically enamoured of Chinese Communism but because he saw a strategic interest for the United States. I would submit that the strategic interests of the United States in a relationship with China in which more elements of cooperation exist than competition is a very considerable interest and it should not lightly be thrown over because of theological or ideological concerns about whether two countries, one country two systems approach like that in Hong Kong might jeopardize Taiwan. I’ve been in Hong Kong a lot, many of you have, and I at least, well I suppose if you really look you can see the oppression from 15,000 feet as you come into the airport, but I haven’t noticed it.

Mr. Gelb: The floor is open now. I’d like to start with Jerry Cohen, please. The rules of the game are: you rise, you wait for the microphone, so we all can hear you, you identify yourself and you give your affiliation.

Mr. Jerome Cohen (Council on Foreign Relations): Jerry Cohen, Council on Foreign Relations. This has been a brilliant debate and I look forward to the remainder of it. I’ve learned a lot from it. But it seems to me, although I’m willing to talk about the international legal points, that the upshot is that we should be leaning now, heavily on Taiwan to come up with some imaginative framework that would at least articulate some distant goal of a one China, greater China framework under which Taiwan would continue to enjoy, as Chas. has indicated, the benefits of its newly found democracy which all of us, I think admire. I think the cost of doing this compared to any other costs are minimal and it simply will require, as Arthur has pointed out properly, with a new Chen Shui-bien moderate regime we have a wonderful opportunity and a president who is potentially, I think, willing to make a try at this. Because so much depends on whether we throw away this opportunity or pursue it. I think Beijing appreciates one country, two systems Hong Kong style is not for Taiwan.

Mr. Waldron: Could I just respond? I think I wouldn’t be in favor of just leaning on one or leaning on the other. I think it’s very important that China extend and olive branch and let me give one specific suggestion. I think that they should start withdrawing the missiles that they are deploying right near Taiwan. I think one of the drivers of this whole thing is the 200 ballistic missiles they put in. They’re adding 50 a year. Even as we speak concrete is being poured. This sends the wrong message.

Under Deng Xiaoping there was talk about reunification and all the rest but there were no military deployments near Taiwan. It was Jiang Zemin who in 1995, I think it was, told the Asahi Shimbun that without the threat of force peaceful unification cannot be achieved. And that introduced a new component here. I think that they have to make it very, very clear that they are removing the threat. Now, I think that the Chen Administration would be very open to the kind of thing that you talk about. But I don’t think that it can be pre-conditions. Frank Ching had a very interesting article in the Far Eastern Economic Review a few weeks ago saying, “Look we have to find out what this one China policy means and that means we have to sit down. PRC has to explain.” Does it mean that Taiwan is part of the People’s Republic. Well, if it means that it’s going to be unacceptable to Taiwan. But maybe there’s some other way we can come up with it. And frankly, I think this can be done. It will be done best when everybody realizes that there is no military solution to this problem. Not for Taiwan. Not for mainland. And I think we Americans have been a little bit remiss, because this Administration has sort of signaled Beijing that we’re willing, because they scare us to go and...that we’ll be the sheep dog for Taiwan.

Mr. Freeman: ...Can I...

Mr. Gelb: Let Jerry respond then back to you.

Mr. Cohen: I just want to say that we ought to be as part of this package, working on the whole demilitarization process. We, by not adhering to our 1982 agreement with China about the reduction of our arms to Taiwan, have been helping to fuel a nascent arms race...

Mr. Waldron: ...did you read Reagan’s comments about..that’s wrong...

Mr. Cohen: ...Arthur, just let me finish..

Mr. Waldron: ...that’s inaccurate...

Mr. Gelb: It’s noted that he disagrees with the fact...

Mr. Cohen: ...The other weakness that we have is in Beijing, because one country, two systems was possible because you had an imaginative formula, but you had a brilliant, strong, accepted leader. Today we have neither in Beijing. No one has come up with a formula and we don’t have a sufficiently strong leadership and that’s part of the equation.

Mr. Freeman: If I may...

Mr. Gelb: ...just let me apologize to both of you in advance. There are all sorts of people who know a lot about this subject in the audience. There are 50 hands up. Let me impose on you the terribly unfair discipline of brevity.

Mr. Freeman: Ah.

Mr. Waldron: What will we do?

Mr. Freeman: Briefly. Very briefly. In the Reagan-Deng agreement to which I referred, during which the United States agreed to reduce arms sales to Taiwan, was the moment at which the with-drawl of forces from Fujian began. They were present in the region in force before that. In 1992, in August 1992, out of apparent concern for the voters of Texas’ opinion of his stewardship, President Bush authorized the largest single sale in U.S. history of weapons, which was 150 F-16s to Taiwan. In no way was that consistent with the bargain. In fact, it was that, it is that, military dynamic, the replacement of a dynamic which from August ’82 to August ’92 that steadily reduced tensions, military installations and produced dialogue across the Strait. It was the end of that that re-militarized the issue and brought us to the sorry conditions that we are now in.

Mr. Gelb: Win...

Mr. Winston Lord (International Rescue Committee): Winston Lord, former government official. [laughter] We have long had the position, the U.S., that this issue should be resolved peacefully but recently an additional stipulation has been added that Arthur referred to namely that any outcome should be acceptable to the people of Taiwan. This could be for either of you, but I suspect Arthur approves of that stipulation. I want to ask you...One, do you like that stipulation, if you don’t why not. But if you do like it do you think it’s realistic to expect the people of Taiwan to want to get close to a regime that is as repressive as the regime now is.

Mr. Freeman: Well, I think you’ve asked about three questions. First, I believe that peaceful settlement implies the assent of the people of Taiwan. Peaceful settlement with a democratic government must enjoy the support of the voters, so I’m not at all disturbed by this phrase. Second, I think that it is true that a peaceful resolution of the issue under current circumstances is virtually inconceivable. So we will never have to put this proposition to a test and my concern is that the very admirable society that has emerged in Taiwan will, as a result of its own inability to deal with an unattractive regime across the Strait, create the conditions for its own demise. I think that is a very valuable society.

Let me say that the irony here, the greatest irony, is that nobody, nobody on the mainland had any desire at all to make this question of reunification an urgent matter. Nobody wanted the status quo to be changed. It was the voters of Taiwan, for reasons that I understand completely with which I even sympathize, who decided that they could not live with the status quo of one China, not now, and wanted a different status quo. Their effort to change the staus quo has created a situation in which there is urgency for Beijing and in which the prospect of peaceful settlement has been severely damaged if not eliminated.

Mr. Waldron: Could I add something very quickly to that. I think this really gets to the difference between Chas. and me. When Chas. is trying to analyze the causes here, his arrow of cause begins in Taiwan and then points into the mainland. The mainland was peaceful. There was no desire to make this an issue until the voters of Taiwan did it. I would respectfully submit that the basic problem is the domestic system in China. This is a regime, after all, which does not negotiate with its own people. It doesn’t give it’s own people much room to live. The example that I always give is how you act at home is probably a good predictor of how you are going to act in society. Or to put it another way, the regime type matters. And a regime which is repressive at home is going to behave in a thug-ish fashion abroad. If you have somebody who at home beats his wife and abuses his children, the chances are that that person is not going to be a model citizen and a good neighbor. And it seems to me that not to recognize that this is a very, very major factor in the way that the current regime in China behaves overseas is simply to ignore 99% of the issue.

Mr. Gelb: Thank you, Arthur. Please, here.

Mr. Richard Gardner (Columbia University): Richard Gardner, Columbia University. I’d like to get the judgment of Chas. and Arthur on some very important decisions that the United States has to take right now, in these days, that bear importantly on the fundamental question you are debating.

First of all the arms sales package to Taiwan. The Administration has granted some of the requests, including missiles, but declined to send four destroyers equipped with the Aegis System. I’d like your judgment about that.

Secondly, in connection with the permanent NTR legislation. Senator Fred Thompson, Republican of Tennessee, has proposed a number of amendments to that legislation. One would incorporate, as an amendment to permanent NTR, the Taiwan Security Enhancement Act and another one would provide for sanctions, it doesn’t specify what, if China goes on, in his view, violating non-proliferation and export control norms.

Mr. Gelb: Yes, thank you Dick.

Mr. Freeman: First on the arms sales issue. In a rational world, where a new government has just been elected in Taiwan, where there is serious question about what direction that government wants to lead Taiwan in, there would have been no decision on arms sales to Taiwan. The issue would have been deferred for discussion once that new government came into office, which happens in May. Deferral is, however, politically impossible in Washington because there is a vote on PNTR. Because, whereas the PRC is the only significant government in Washington to have a contract with neither a public relations firm and to have the...maybe it’s the only one to have the PR instincts of Godzilla, but I don’t know...the only country, or the only country not to have engaged a lobbyist, and whereas one of the reasons it couldn’t, even if it wanted to, engage either a PR firm or a lobbyist, is that they are all under contract to Taiwan. The fact was that there was no way that the Administration could avoid the issue of arms sales to Taiwan and therefore there was a rush to provide weapons. In these circumstances I think the Administration, which one has to accept political realities, in these circumstances I think the Administration did well.

Second, on the issue of linking permanent normal trade relations to various extraneous issues that have nothing to do with the competitiveness of American companies in the China market, which is what this is about. I think that’s nonsense and it is the kind of absurd thinking that justly caused Mark Twain to call the United States Congress “America’s only native criminal class.” [laughter]

Mr. Gelb: It’s not the only one. I think I would disagree with you on China’s difficulty in finding PR consultants.

Mr. Freeman: Really?

Mr. Gelb: Yeah...[laughter]

Mr. Waldron: Let me just observe that to make little snyde comments about, well, Taiwan has good PR and the Congress are our native criminal class, in a way it trivializes our own system. I always counsel people who are going to China, when somebody starts telling you, “Boy, that Congress is a problem,” do not bite. Say, “We’re a democratic country. Those people are our elected representatives. We stand up for what they say. You want to change their minds, you go and try to do that in an open way.”

I also think it’s important not to substitute economics for security. Economics and security are two different things. One of the problems this Administration has is that it sort of focuses on the economics and then it suggests that that is also dealing with the security. It’s not dealing with the security and I’m in favor of having a package which addresses all of the concerns that arise with respect to China and not just one.

Finally, I’m very interested that Chas. is once again saying that the reason that we should act is that China is dangerous. In other words, fear. That the way that we should influence Taiwan is by standing on their oxygen hose. In other words, threatening them that if they don’t do something, we’re going to start cutting off their arms supplies. That’s not a way that a great power that is confident in it’s own values believes, acts. And it’s not the way a power that expects other countries take it seriously acts. That’s a recipe for losing the relationships we have with other countries around the world and the respect, not least of the people in China.

Mr. Gelb: Arthur, just so I understand you. You would be in favor of meeting Taiwan’s full arms sales request.

Mr. Waldron: Well, there are some very complex technical issues here...[laughter]...Well, it’s true! It’s true! I think that one of the problems with the Taiwan arms request is that they have become highly politicized and I think that what we need to do is to develop a security relationship there which is credible, which is appropriate, and which is seamless and dependable because what the people in Taiwan need to feel, if they are to engage in the kind of negotiation, and so forth that we all want to see, they need to feel that they are secure and that we’re not going to come around and say “We’re going to pull the rug from under you at this particular point.”

Mr. Freeman: I want to repeat something that I said in my opening remarks. We now have a policy of military deterrence with no political element to it. In the 1980s we transformed the Taiwan issue into a political issue with military aspects. We have now re-transformed it into a military issue with political aspects. And it is being dealt with in terms of the level of arms sales, not the relationship across the Strait.

Mr. Gelb: I think this will have to be the last question before concluding statements. Paul Heer?

Mr. Paul Heer (Council on Foreign Relations): My name’s Paul Heer, I’m with the Council on Foreign Relations. Earlier in the discussion there was an exchange which started out as humorous, but Arthur made the point that if living under the regime was not good enough for Chas. or any of the rest of us, why would it be good enough for Taiwan? It seems to me that a partial answer to that question is that it’s not altogether certain that the regime existing in the mainland would be the one fully imposed on Taiwan. This is subject to negotiation. My question is...is there any definition of one country, two systems or of one China that is acceptable to Taiwan, would be?

Mr. Waldron: I’m inclined to think that the answer to that is “Yes.” Remember that a one China policy from Taiwan has been on offer until about two months ago at which point President Chen, correct - President-elect Chen, said correctly that there is no consensus in Taiwan on this issue and that they’ve got to talk to each other and decide what their consensus is going to be and they want to hear from PRC what they mean by one China. But the pieces have always been there in the Kuomintang Constitution. I mean poor old Lee Teng-hui was crucified by the pro-independence types because he was alegedly in favor of reunification and one China at the same time that he was being lambasted by PRC for being a split-ist. That suggests to me that he was at a rather realistic point in the middle.

The best thing that China could do right now, in addition to beginning to remove the missiles and indicating that they are not substituting a fundamental policy of military suasion for a peaceful policy, would be to give Hong Kong full scale democracy. As you know there is a lot of discussion now in Hong Kong as to whether they are going to have a fully elected parliament, whether they are going to have responsible government, whether their chief executive should be elected and so on and so forth. And there’s consensus across the political parties that there should be direct election. But the tycoons are worried about this and PRC is worried about it. If China would make Hong Kong into a showcase about what is possible, complete political freedom, no limits on freedom of discussion, freedom of the press, let’s have a court of final appeal that is right there in Hong Kong. Do that and run that for 10 or 15 years so that it becomes clear that it will really work. That would do more than anything else I can think of to make the prospect of some kind of a solution credible to the people of Taiwan.

Mr. Gelb: Concluding statements. Let me hold you each to two statements. Arthur, you’re going to go first this time. I’ll give you a thirty second warning and then to you Chas.

Mr. Waldron: Well, I don’t really have much to say in addition to what I’ve already said. I would stress, though that the game of “chercher Taiwan” that we play when we talk about issues involving China...somehow everything one way or another goes back to something that Taipei did or perhaps something that Washington did. The lesson of Chinese history, as I read it is that big forces are inside continental mainland China. I think that is particularly true today and I think that that is what any serious Chinese intellectual will tell you. The present system can’t go on indefinitely. We’re approaching some kind of a period of stress, there’s no question in my mind, that could end badly or could end well. But that, and not anything that we do or that Taiwan does, is ultimately going to determine the future, not only of the cross Strait relations but also the future of peace in Asia.

Now while we wait for this change, it’s important that we not become co-opted, or become too involved, or too dependent on favorable outcomes in China. We’ve got to hedge our bets. We’ve got to maintain our credibility as an ally. This is what Taiwan...we may wish that it hadn’t happened this way...There is an expectation, as I said, that Taiwan was going to disappear. It didn’t happen. You know, it is an unwanted child, arguably, but I think that we have to stick by it.

I just close with a statement from Richard Nixon in 1979 which I think is quite perceptive. He says, “At a time when U.S. credibility as a dependable ally and friend is being questioned in a number of countries, it is also vitally important that the Taiwan issue be handled in a way which will reassure other nations, whether old friend, new friends, potential friends or wavering friends, that it is safe to rely on America’s word and to be America’s friend.” Thank you.

Mr. Gelb: Thank you very much Arthur.

Mr. Freeman: But what if America forgets what its word was and insists willy-nilly on enforcing a word that the other side has unilaterally re-defined. Arthur presupposes that the best solution to all of this is somehow the end of the regime in Beijing, which he thinks would solve the issue. Let me say that I th